Quality systems management

National Institute of
Business Management
Master of Business
Administration (MBA)
Quality Systems Management

Chapter Title Page No.
I QUALITY CONCEPTS AND DEFINITION 5
II QUALITY CONTROL AND INSPECTION 19
III TOTAL QUALITY MANAGEMENT 30
IV BENCHMARKING 38
V QUALITY CIRCLES 50
VI ISO 9000 & 14000 QUALITY STANDARDS 74
VII CE MARKING 95
VIII SOFTWARE QUALITY ASSURANCE 101
CONTENTS
CONTENTS
CONTENTS
CONTENTS
CONTENTS

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CHAPTER - I
QUALITY CONCEPTS AND DEFINITION
OBJECTIVE
Qualitycanreferto:
1. Aspecificcharacteristicofanobject
2. The essence of an object
3. TheachievementorexcellenceofanobjectThemeaningofexcellenceitself
So the quality of something depends on the criteria being applied to it. Something might be
good because it is useful, because it is beautiful, or simply because it exists. Determining or finding
qualitythereforeinvolvesanunderstandingofuse,beautyandexistence-whatisuseful,whatisbeau-
tifulandwhatexists.
Learning objectives: - This chapter mainly deals with (1) Definition of “quality” and its
importance (2) Quality Characteristics etc.
Introduction
Every manufacturing organization is concerned with the quality of its product. As quantum
of production is met by planned production schedule, it is also essential that the products meet the
specifications. Customer is always interested in quality products.
“Quality” has been generally defined as “fitness for use”. This means that the product or
service meets the customer’s needs, i.e., the product is fit for the customer’s use. Fitness for use is
related to the value received by the customer and his satisfaction. Only the customer and not the
producer can determine the value of the product.
Fitness for use is a relative concept, which varies from one customer to another. For example,
while one customer may consider a Ford automobile perfectly fit for use, another may not. Each person
defines quality in relation to his or her own needs.
From the producer’s view point, variation in quality cannot be tolerated. The producer must
specify quality as concretely as possible and then strive to meet those specifications. Whether the
resulting product is fit for use or not will then be judged by the customer.
Quality is generally more difficult to define for services than for manufactured products.
Whether the product is a service or goods, however, the following dimensions of quality may be taken
into consideration.
Quality of design
Quality of conformance
The “abilities”
Field service.

6
Quality of design is determined before the product is produced. In a manufacturing company,
thisdeterminationisusuallytheprimaryresponsibilityoftheengineeringdepartment,alongwithmarketing
and operations. In service organisations, quality of design is handled by the personnel responsible for
designing services.
Quality of design is determined by market research, design concept and specifications. Market
research is ordinarily aimed at determining the customer’s needs. Since there are different ways to
meet these needs, a particular design concept must be developed. For example, the customer may
need inexpensive and energy – efficient transportation – a need that can be met by a large number of
different automobiles, each representing a different design concept. The design concept then results
in a set of specification for the product, e.g., blueprint, bill of materials, or service specification.
Quality of conformance means producing a product to meet the specifications. When the
product conforms to specifications, it is considered by operations as a quality product even though
the quality of design may be low. For example, an inexpensive pair of shoes will have high “quality” if
they are made according to specifications, and they will have low “quality” if they do not meet
specifications. Quality of design and quality of conformance thus represent two different uses of the
term “quality”.
Another aspect of quality involves the so-called abilities: availability, reliability and
maintainability. Each of these terms has a time dimension and thus extends the meaning of “quality”
beyond the beginning or starting quality level. The addition of time to the definition of quality is, of
course, necessary to reflect the fitness for continued use by the customer.
“Availability” defines the continuity of service to the customer. A product is available if it is
in an operational state and not in disuse due to repairs or maintenance. In the army, availability is
equated with operational readiness. Availability can be measured quantitatively as follows:
“Reliability” refers to the length of time that a product can be used before it fails. Formally
speaking, reliability is the probability that a product will function for a specified period of time without
failure. The reliability of a light bulb for 1000 hours might, for example, be 80 percent. In this case, if
many light bulbs are tested for 1000 hours, 80 percent of them will burn the entire time and 20 percent
will fail. The reliability of a product is also related to Mean Time Between Failures (MTBF), which is
just the average time that the product functions from one failure to the next. The longer the MTBF,
the more reliable the product.
“Maintainability” refers to the restoration of a product to service once it has failed. All
customers consider maintenance or repairs a nuisance. Thus a high degree of maintainability is desired
so that a product can be restored to use quickly. Maintainability can be measured by the Mean Time
To Repair (MTTR) the product.
Availability
Uptime
Uptime Downtime
=
+

7
Returning to availability, we see that availability is a combination of reliability and
maintainability. If a product is high in both reliability and maintainability, it will also be high in availability.
Thus relationship can be expressed formally as:
If product has an MTBF of 8 hours and an MTTR of 2 hours each time it fails, then its
availability will be 80 percent.
The last dimension of quality is field service, which represents warranty and repair or
replacement of the product after it has been sold. Field service is intangible, since it is related to such
variables as promptness, competence and integrity. The customer expects that any problems will be
corrected quickly, in a satisfactory manner, and with a high degree of honesty and courtesy.
Unfortunately, field service is often one of the least well defined and most poorly controlled dimensions
of quality.
The four different dimensions of quality are summarized in Figure (1). As can be seen, quality
is more than just good product design; it extends to
—
—
—
—
— Quality characteristics
Quality characteristic could be defined as a physical or chemical property, a dimension, a
temperature, pressure, taste, smell or any other requirements used to define the nature of the product
or service which contributes to the fitness for use.
Quality characteristics can be classified as:- (i) Technological, (ii) Psychological, (iii) Time
oriented, (iv) Contractual and (v) Ethical. These could be represented as below:
Fig. (1)
Quality for the manufactured product may be defined primarily by technological and time
oriented characteristics while a service product may involve all the characteristics listed above.
Quality characteristics may be directly measurable such as weight, specific gravity, diameter
etc. or non-measurable such as cracks, breakages etc. For each quality characteristic there are a
number of activities such as design specifications, process engineering, purchase, instrumentation,
operation inspection, sales, use etc.
—
—
—
—
— The quality function
The survival of any organization depends on the income it gets from selling its products and
services and the ability to sell is based on the quality. Hence the company functions concerned with
Availability =
+
MTBF
MTBF MTTR
Quality Characteristics
Technological Time Oriented Con
Psychological

8
quality or achieving fitness for use are known as quality functions. It includes variety of activities.
Everyone working in the organization is responsible for the broad quality function.
With the help of market survey, the company determines what qualities are needed by the
customers. Research and development specialists create a product concept which can meet the quality
needs of the users. Design engineers prepare product and material specifications considering the quality
requirements. Process engineers specify the processes, machines and instruments capable of producing
the products with the desired quality, and inspecting them. Purchasing specialists buy materials and
components possessing appropriate qualities. Operators are trained to use the process and instruments
to make the product as per the design. Inspectors examine the product to judge conformity with the
design. Consumers use the product and experience of using the product becomes the basis for a
redesign or improvement in the product, which starts the cycle all over again.
The spiral of progress in quality could be represented as below:
—
—
—
—
— Costs of quality
The costs of carrying out the quality functions (i.e., meeting the quality needs of the customers
of the company) are known as costs of quality.
These include
1. Market research costs
2. Product research & development costs
3. Designs costs
4. The cost of manufacturing planning
5. Cost of inspection and test
Research
Service
Test
Inspection
Process Control
Production
Instrumentation
Research
Development
Design
Specification
Planning for
Manufacture
Purchasing
Vendors

9
6. Cost of defect prevention
7. Cost of scrap, quality failures
8. Cost of quality assurance
9. Field service costs and such other costs attributed to the quality improvement & maintenance
But a Quality Cost Committee of the American Society for Quality control has recommended
that the quality costs be defined into four categories.
1. Cost of prevention
2. Cost of appraisal
3. Cost of internal failures
4. Cost of external failures.
Cost of prevention
It includes the costs associated with personnel engaged in designing, implementing and
maintaining the quality system. These costs are incurred to keep failure and appraisal costs to a
minimum. Cost of prevention includes: -
Cost of quality planning: - This consists of costs associated with creating an overall quality
plan, the cost of market research and product development, inspection plan, reliability plan etc.
Cost of documenting: - Cost of preparation of manuals and procedures needed to
communicate these plans to all concerned.
Process control cost: - Cost associated with implementing the quality plans and procedures.
Cost of training: - Costs of preparing training programmes for attaining, maintaining and
improving quality performance.
Costs associated with preventing recurring defects: - Includes engineering, technical and
supervisory costs of preventing recurring defects.
Costs of investigation, analysis and correction of causes of defects by quality control
department and engineering department.
Cost of cost consciousness programmes
Cost of appraisal
This is the cost associated with the measuring, evaluating or auditing of products, components
and purchased material to assure that they conform with quality standards and performance
requirements. This consists of the costs of performance requirements. This consist of the costs of :
1. Receiving or incoming test and inspection
2. Laboratory acceptance testing

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3. Inspection and test
4. Checking labour
5. Set up for inspection and test
6. Inspection and test material
7. Maintenance and calibration of test and inspection equipment
8. Quality audits
9. Review of test and inspection data
10. Evaluation of field stock and spare parts.
Cost of internal failures
The costs associated with defective products, components and materials that fail to meet
quality requirements and result in manufacturing losses are called as costs of internal failures. This
includes:
1. Cost associated with scrap – i.e., cost of material, labour and burden of non-usable parts.
2. Cost of rework and repair – i.e., the cost of rectifying defective parts and assemblies.
3. Cost of re-inspection and re-test after the defective parts are repaired.
4. Cost associated with material review activity.
5. Cost of disposition – i.e., Cost associated with the efforts required to determine whether
the defective products could be used for some other work and then make the final disposal.
6. The costs of lower yield from the process which can be improved by better controls.
Cost of external failures
It consists of the costs, which are generated because of defective products being shipped
to customers. This includes:
i. Cost of processing complaints from customers
ii. Cost of service to customers who receive defective items
iii. Cost of inspecting and repairing the defective items returned by the customers
iv. Cost of replacing the defective materials or products
v. Cost of concessions made to customers due to substandard products being accepted by
the customers.
—
—
—
—
— Optimum cost of performance
The sum of the appraisal and prevention costs rises from zero to infinity as perfection is
approached. The failure costs drop from infinity to zero as perfection is approached. The total quality

11
costs have a minimum or optimum between two infinities. This is made clear by the figure below:
When failure costs dominate, the total cost can be reduced by reducing the cost of failure.
This could be done by concentrating on the main defect areas. When the appraisal cost dominates,
the total cost can be reduced by widening the tolerances, reduction of more effective inspection test
procedures etc.
Fig. (2)
Value of quality
When the product or service is of superior quality, the company earns a higher share of
market, better price and other such benefits to income. It is this effect on income, which makes quality
to have value. Hence value of quality can be defined as the return, direct or indirect, gained by the
manufacturer due to mission of quality control.
Value of quality is composed of
1. Value inherent in the design
2. Value inherent in the conformance to that design.
The value inherent in the design is usually called as grade. Grade is the variation in specification
for the same functional use. Grade is usually differentiated by differences in life of the product
(appearance, interchangeability factor of safety etc.) or extent of maintenance required (reliability, luxury
features etc.).
The value of quality is usually very difficult to assess. It could be assessed considering various
Quality Products
Total cost
Prevention & Appraisal cost
Failure cost
Optimum point
Cost
of
Products
in Rs.

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factors like: -
i. The saving due to increased production
ii. Reduction in scrap and rework cost
iii. Increased sales of good quality product
iv. Indirect factors such as
a. Reputation of the manufacturer and good will of the customer
b. Psychological stability in the enterprise due to increased sales and security of jobs to workers.
BALANCE BETWEEN THE COST OF QUALITY AND VALUE OF QUALITY
From a company’s point of view, profit is more important. The quality of design should be
such that it meets the customer’s needs and at the same time the manufacturing costs would be such
that it would yield maximum profit. The aim should be to improve quality at lower cost.
Consider the figure below: -
Cost
in
Rs.
C
A
1 2 3
Quality of Design
Fig. (3)
Quality of Design
From the figure, if the quality of design is to be improved from 1 to 2, the cost of quality
would increase by amount A and the value of quality would increase by amount B. Since B>A,
improvement in quality at this level will yield more income.
Cost of quality
Value of quality
D
B

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But if the quality of design is to be improved from 2 to 3, then from figure D<C or increase
in the value of quality is less than the increase in the cost of quality. So point 2 is the optimum quality
of design. Below this optimum the profit cannot be maximized and above this point it is uneconomical
to improve the quality of design.
SPECIFICATION OF QUALITY
The design remains a concept in the mind of the designer as long as it is explained through
verbal description, sample drawing etc. The demands of the application are transformed into
requirements and requirements are quantified. These quantified requirements are called specifications
or a specification is a definition of design. The specifications thus contain the list of essential
characteristics and their tolerances.
The subject matter of quality specifications may include:
1. The material specifications (e.g.:- components, ingredients and finished products)
2. Process specifications
3. Method of test
4. Criteria for acceptance and rejection
5. Method of use
6. Complete programmes.
Materials refer to components or parts entering semi-finished or finished goods while product
usually refers to finished goods. Once a definition is available any one of the parties in the industry
can communicate any other and use shorthand of the specification to define a complex product.
FUNCTIONAL AND NON-FUNCTIONAL REQUIREMENTS
Many drawings and specifications contain both functional as well as non- functional
requirements desired in the products, components etc.
Functional requirements ensure performance for intended use, long useful life, minimize
accident hazards, provide interchangeability and also provide competitive sales advantage. An important
element in many functional specifications is the tolerance limits.
Non-functional requirements inform the seller the method of manufacture, reduce cost of
manufacture, facilitate manufacture etc.
Specifications may be of the following types:
1. Standard specifications or national specifications
2. Customer specifications
3. Company specifications.

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Standard Specifications
Specifications process has been made more simple by the growth of standards for materials,
components, processes, tasks, products etc. Most of the countries have their own standard bodies
to formulate the specifications. In India it is done by the Bureau of Indian Standards or BIS. There
are a number of technical committees within BIS. The members constitute manufacturers, users,
research organizations, Govt. departments and other interested individual experts or organizations.
Consumer Specifications
When BIS specifications are not available or not suitable for a particular customer needs,
the customer provides the specifications to suit his particular needs and the manufacturer may agree
and produce the product as per the specifications given by the customer.
Company Specifications
When a company manufactures products to its own specifications due to certain constraints
and the consumer accepts them, the specifications may be called company specifications.
When the manufacturer and the consumer agree on a contract, it is called contract
specifications. These specifications consist of
1. Specification identification - Which includes the name of the product, a number which serves
as a shorthand description, date and serial number etc.
2. Product description – which describes the product completely, using shorthand designations
– for e.g. :- make, size, grade, number of components and then description etc.
Process Specifications
It is necessary to specify the process to produce the particular product with the specified
quality.
The process specifications may include:
1. Specification identification.
2. Material used, by their shorthand designation and quantities of each.
3. Sequence of operations to be performed.
4. Description of each operation, including machines and tools to be used.
5. Process conditions to be maintained to produce the product with the stated quality (for e.g.:
- temperature, pressure etc.).
6. Process testing to be performed – test of process acceptance.
Test Specifications
These include (1) Scope of the test specification (2) Purpose of test (3) Apparatus to be
used (4) Method of selection and preparation of sample or specimen (5) Test procedure (6) Data to
be recorded.

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Use Specifications
These generally contain:
1. Description of conditions under which the product is intended to be used.
2. Procedure for installation, precautions to be taken, while using or operating.
3. Operating procedure.
4. Maintenance procedure.
APPLICATIONS OF QUALITY COSTS
Company and plant management, together with functional heads, and assisted by the Manager
- Quality Control, are constantly making decisions which affect the costs in the various segments in
order to obtain the minimum total operating quality cost at the desired outgoing quality level. Quality
costs provide some basically sound “tools” for arriving at such decisions. They may be used as follows:
Quality costs serve as a measurement tool
Since quality costs are broken down into segments, it is possible to obtain a dollar
measurement on each quality activity. For example, the dollars invested in quality planning can be
measured as to the quality-engineering costs devoted to that activity. Justification for this investment
can be measured by reduced failure costs as a result of quality planning and by reduced quality -
appraisal costs as a result of more efficient inspection methods.
Quality costs provide comparative measurements for evaluating quality programs versus the
value of the results achieved.
Quality costs serve as a process - quality analysis tool
To use only the measurement tool is not enough; it is also necessary to analyse particular
quality costs. Quality costs, when properly broken down by product lines or segments of the process
flow, will pinpoint major problem areas and serve effectively as an analysis tool.
Quality costs serve as a programming tool
An analysis provides a basis for specific courses of action. Planning for carrying out these
courses of action involves establishing a program. One of the important functions of a program is the
assignment of available labour, and other resources, for carrying out the action. Since resources are
usually limited, quality costs are a means for identifying those actions which provide the highest potential
payoff, hence those actions should have priority with reference to time sequence.
Quality costs serve as a budgeting tool
Quality costs are a guide to budgeting the necessary expenditures for accomplishing the
desired quality-control programs. Such programs, of course, take into account the objectives and

16
goals of the business. As shown by a previous example, the long-range objective may be to attain
high product reliability. In such a case, one aspect of the program would be directed toward staffing
a strong quality engineering effort to do pre-production evaluation and quality planning.
All programs may not be immediately feasible in view of available resources. Programs may
have to be brought along successively, building toward goals that take 2 to 3 years to realize. Such a
procedure helps to assure realistic budget and attainment of specific reliability goals.
Quality costs serve as a predictive tool
Quality-cost data provide the controls to evaluate and assure performance in relation to the
goals and objectives of the company. They are effective in producing valid cost estimates in obtaining
new business in service or products and in meeting competition in the market place. Quality-costs
data also aid in the positive evaluation of product performance in relation to service and warranty,
including repairs and replacements and product-recall or liability expenses (including the cost of liability
insurance).
CASE STUDY
QUALITY COST – BHEL, HYDERABAD EXPERIENCE
Against this background, with an increased awareness on Quality and a committed support
of the Top Management, estimation of Quality Cost in Financial terms is being done in systematic
way at BHEL, Hyderabad for the past few years. This approach is useful for triggering programmes
for Product Quality Improvement and reduction of Quality Costs, which are now below 3%.
BHEL, Hyderabad has a well-documented Quality Assurance System Manual, Organisational
structure consisting of Quality Assurance and Quality Control, and the Chief of Quality directly reporting
to the Chief Executive. In such a setup the evaluation of Quality Cost has become an easy task.
The quality cost evaluated during the last seven years are tabulated in Table -1. As could
be seen, the Quality Costs were more or less nearer to the values specified in the International
literatures applicable to our Industries. However, the cost of control was low, while the cost of failure
to control was on the higher side.
The Internal Failure Costs and the External Failure Costs were analysed starting from highest
value of rejections. This has led to the identification of areas of major wastages/failures. This
identification is of paramount importance since wastages/failures as stated above form a potential threat
to the growth of business and even result in heavy erosion of profits. To avert this, areas needing
improvement of quality has been identified and Quality Improvement Projects were initiated on a
continual basis. Also strategic decisions were formulated to reduce the cost due to failure on account
of quality. They are enumerated as under:
Organising intensive Quality related training programmes covering all employees at all levels
in the respective problem areas.

17
Periodic review of the status of Quality by an Apex body at the Plant level.
Periodic updating of Quality Systems.
Quality Audit, initiation of corrective actions and review for implementation.
Initiation of Design and Technology reviews.
Quality Improvement Projects.
Introduction of SQC in shop floor.
It may be worthwhile to note that through the above stated approach, the varying elements
of Quality Costs have perceptible influence on the overall cost of quality individually and collectively.
In other words even the marginal increase in the Cost of control can produce remarkable results on
the Cost of failure to control and totally both together yield astounding results. This is not a mere
theory but it has been amply demonstrated by the experience of BHEL, Hyderabad. In the last 3
years, with their continued efforts and with a slight increase in the costs of control from 0.99% to
1.04% (0.05% increase), the Cost of failure to control has been brought down to 1.54% from 1.92%
(0.38% decrease). This is in spite of the increase in turnover by 15% with diverse product range.
Table-1 Quality Cost Evaluation Value in Lakhs
Sl. Description 82-83 83-84 84-85 85-86 86-87 87-88 88-89
No
1. Turn Over 16918.00 23303.00 29099.00 35393.00 35063.00 36115.00 39765.00
2. Prevention 18.90 20.80 22.88 25.17 27.31 28.89 35.78
Cost (0.11%) (0.09%) (0.08%) (0.07%) (0.08%) (0.08%) (0.09%)
3 Appraisal 266.40 279.72 293.71 308.40 318.80 343.09 377.76
Cost (1.57%) (1.20%) (1.01%) (0.87%) (0.91%) (0.95%) (0.95%)
4 Internal 188.59 197.08 203.52 334.92 340.24 331.55 319.23
Failure Cost (0.11%) (0.85%) (0.70%) (0.95%) (0.97%) (0.92%) (0.80%)
5 External 189.48 266.33 357.52 329.36 333.34 323.70 294.26
Failure Cost (1.12%) (1.14%) (1.23%) (0.93%) (0.95%) (0.90%) (0.74%)
6 Cost of
Control (%) 1.69 1.29 1.09 0.94 0.99 1.03 1.04
(2+3)
7 Cost of
Failure to 2.23 1.99 1.93 1.88 1.92 1.81 1.54
Control (%)
(4+5)
8 Total
Quality 3.92 3.28 3.02 2.82 2.91 2.84 2.58
Cost(%)
(6+7)
Read the case on BHEL given above and prove that “ Cost of Central can Procedure
remarkable results. On the cost of failure to control and both together yield unbelievable results” .

18
SUMMARY
Quality is a flexible and comprehensive group decision making technique used in product or
servicedevelopment,brandmarketing,andproductmanagement.Qualitycanstronglyhelpanorgani-
zation focus on the critical characteristics of a new or existing product or service from the separate
viewpointsofthecustomermarketsegments,company,ortechnology-developmentneeds.Theresults
ofthetechniqueyieldtransparentandvisiblegraphsandmatricesthatcanbereusedforfutureproduct/
servicedevelopments.
Qualitytransformscustomerneeds(thevoiceofthecustomer[VOC])intoengineeringcharac-
teristics(andappropriatetestmethods)ofaproductorservice,prioritizingeachproduct/servicechar-
acteristic while simultaneously setting development targets for product or service development. The
techniqueisalsousedtoidentifyanddocumentcompetitivemarketingstrategiesandtactics.
QUESTIONS:
1. Define Quality? What are the dimensions of quality to be considered for a product or a
service?
2. Illustrate by means of a figure to show how balance between cost of quality and value of
qualityismaintained?
3. What are the essentials of quality specifications? What are its types?
4. Whataretheapplicationsofqualitycosts?Explainwithexamples?
5. Whatisreliabilityandmaintainability?Howisitrelated?

19
CHAPTER - II
QUALITY CONTROL AND INSPECTION
OBJECTIVE
Inengineeringandmanufacturing,qualitycontrolandqualityengineeringareinvolvedindevel-
oping systems to ensure products or services are designed and produced to meet or exceed customer
requirements. These systems are often developed in conjunction with other business and engineering
disciplinesusingacross-functionalapproach.coversallactivitiesfromdesign,development,produc-
tion,installation,servicinganddocumentation,thisintroducedtherules:“fitforpurpose”and“doitright
thefirsttime”.Itincludestheregulationofthequalityofrawmaterials,assemblies,productsandcom-
ponents; services related to production; and management, production, and inspection processes.
This chapter opens before you certain major facts about quality control and inspection. It
deals with:
o Definition and concept of quality control and inspection
o The main difference between the two
o Aims and objectives of quality control and inspection
Introduction
The word ‘control’ usually stands for a process by means of which the actual performance
is observed and compared with some standard performance. If there is a deviation in the observed
performance from the standard performance, corrective action is taken. When the term quality control
is defined it could be naturally understood that the control is made with respect to the quality of the
product or service. Inspection is only one of the stages of quality control. These two terms are
described in more detail in the following chapters.
Quality control
The term quality control has a variety of meanings such as: -
1. As mentioned earlier, quality control is the process through which the actual quality is
measured, it is compared with the standard quality and corrective action is taken if there
are deviations.
2. It is a systematic control of various factors that affect the quality of the product. It depends
on material, tools, machines, types of labour, working conditions, measuring instruments etc.
3. Quality control can be defined as the entire collection of activities which ensure that the
operation will provide the optimum quality products at minimum cost.
4. It can also be defined as the tools, devices or skills through which quality activities are carried
out.

20
5. It is the department which devotes itself full time to quality functions.
6. The procedure for meeting the quality goals is termed as quality control.
7. It is a system, plan or method of approach to the solution of quality problems.
8. As per A.Y. Feigorbaur, Total Quality control is:
“An effective system for integrating the quality development, quality maintenance and quality
improvement efforts of the various groups in an organization, so as to enable production and services
at the most economical levels which allow full customer satisfaction.”
Steps
Steps involved in a Quality control programme are: -
1. Formulate quality policy.
2. Work out details of product requirements, set the standards or specifications based on
customer’s preference, cost and profit.
3. Select inspection plan and set up procedure for checking.
4. Detect deviations from set standards or specifications.
5. Take corrective actions through proper authorities and make necessary changes to achieve
standards.
6. Decide on salvage method i.e., decide how the defective parts are disposed of, scrap entirely
or rework.
7. Co-ordination of quality programmes.
8. Developing quality consciousness in the organization.
Quality control is not a function of any single department or a person. It is the primary
responsibility of any supervisor to turn out work of acceptable quality.
Aims or Objectives of Quality Control
The various objectives of quality control are:-
1. To improve the company’s income by making the product more acceptable to the customers
by providing long life, greater utility, aesthetic aspects, maintainability etc.
2. To reduce company’s cost through reduction of the losses due to defects.
3. To achieve interchangeability of manufacture in large-scale production.
4. To produce optimum quality at minimum price.
5. To ensure satisfaction of customers with products or services of high quality level, to build
customers goodwill and confidence in the reputation of manufacturer.

21
6. To make inspection prompt to ensure quality control at proper stages to ensure production
of non-defective products.
7. Judging the conformity of the process to the established standards and taking suitable actions
when there are deviations.
8. To improve quality and productivity by process control, experimentation and customers
feedback.
9. Developing procedure for good vendor – buyer relations.
10. Developing quality consciousness in the organization.
Inspection
Inspection means checking of the material, product or components of product at various
stages in manufacturing. Inspection often involves a decision on product acceptance, but it has other
purposes also, such as regulating manufacturing process, rating overall product quality, measuring
inspection accuracy and sorting out the faulty or defective item.
Inspection planning involves:
a) Selection of type of inspection for different stages in production flow.
b) Planning inspection operations in detail.
c) Designating the stations at which inspection should take place.
d) And of providing inspectors with the inspection specification, gauges, tools, test equipments
and other information necessary for inspection.
Objectives of inspection
Various objectives of inspection are: -
1. Receiving inspection: - The incoming material, purchased parts are inspected to ensure that
they are according to the required specifications. It also aims at evaluating the vendor’s quality
and ability to supply acceptable materials.
2. In-process inspection: - This is done as the raw materials undergo processing from one
operation to another. This aims at isolating the faulty semi-finished goods before it enters
the next operation. This also aims at avoiding working on already defective parts, thus saving
the expenditure.
3. Finished goods inspection: - To inspect the final finished product – the basic aim is to detect
the defects and its sources. It may also be necessary to carry out the functional test, to ensure
that the product functions properly.
4. To maintain customer relations: - To ensure that no substandard or defective product reaches
the customer.

22
5. Gauge maintenance: - Control and maintenance of measuring instruments and inspections
gauges.
6. Test equipment maintenance: - To maintain the equipment such as ultrasonic flaw detector,
toolmaker’s microscope etc.
7. Decision on salvage: - Decisions are required regarding the defective parts. Some of these
parts could be accepted after minor repairs.
Selection of inspection stations
The most usual conditions suggesting inspection stations are: -
1. At the receipt of goods from the vendors usually called as vendor inspection.
2. During set up of operations.
3. At delivery of goods from one department to another, usually called in-process inspection.
4. During the progress of high quality or high expense operations.
5. Upon completion of all fabrication operations usually called finished goods inspection.
6. Before completing an irreversible, expensive operation – e.g.: - Pouring of melted steel.
7. At natural peepholes in the process.
But these stations are not followed as a general rule. Sometimes there arises a need for
inspection stations even at other instances.
Information for inspection
The inspectors when carrying out the inspection process, need information on what the
product is supposed to be. The various sources of information are: -
1. The customer’s order defining what he needs and any modification from the specification.
2. The product specification, defining the properties of the product.
3. The list of quality characteristics that are to be inspected. At any inspection station, usually
an inspection instruction is prepared listing the inspection characteristics, inspection methods
and sample size.
4. Results of prior measurements of the product under consideration.
5. Information on prior performance of the same source of manufacture – for e.g.: - in case of
vendor, machine, process etc.
6. Other general information, which would add on to the inspector’s perspective. This includes
the manufacturing flow chart, usage information and knowledge of prior complaints and
troubles.

23
7. Detailed inspection or test procedure which contains some or all of the following items: -
a. Test to be conducted, with step by step procedure
b. Measurements to be taken and equipment to be used
c. Data to be recorded
d. Sample size for each test to be conducted
e. Procedure for selecting sample units
f. Required accuracy of test equipment
g. Environmental conditions during tests
h. Criteria for ‘acceptance’ and ‘rejection’ decision
i. Report to be prepared
j. Action to be taken in case of rejection decision
k. Requirement for certification of test results by independent agency
l. Responsibility of the inspector in accepting or rejecting the product.
8. Every product has a detailed inspection manual having the following information
a. Product specification
b. Flowchart
c. Receiving inspection
d. Inspection procedures in different manufacturing departments
e. Final inspection
f. Quality rating and
g. Quality information feedback.
Inspection stages
The various stages of inspection are: -
1. Incoming inspection (Receiving inspection)
Incoming inspection is the inspection of incoming raw materials, components, sub-assemblies
and purchased parts to ensure that they are according to the required specifications. The aim of receiving
inspection is to prevent the entry of goods that do not fulfill the quality requirements into the production
process thereby avoiding production problems or delays. Incoming inspection is therefore undertaken
before the goods go into production stage.
2. In-process inspection
It is the inspection of raw materials as they undergo processing from one operation to another.

24
In-process inspection can be carried out as: -
1) First piece inspection
2) Patrol or floor inspection
3) Operator inspection
4) Last piece inspection
5) Centralised inspection
First piece inspection: - Here the inspection is carried out on the first item made after the
machine is set up. If the work conforms to the prescribed standard, the operator is allowed to carry
out the regular production; if it is unsatisfactory, adjustments are made in the set up.
Advantages
1) Wastage is minimized in the early stage itself thereby reducing the cost of production.
2) By testing the first piece the faults in the setting up of the machine or process can be traced
out and corrected.
Disadvantages
1) Production cannot be started unless the first piece is inspected.
2) Men and machine may remain idle for want of piece inspection.
Floor, patrol or roving inspection: - In this kind of inspection, system quality is checked at
machines or at floor, The inspector walks round on the shop floor from machine to machine and
checks samples of the work of various workers.
Advantages
1) Floor inspection is particularly suitable when the products manufactured are heavy and when
the individual inspection station can be effectively integrated with line production.
2) Handling of material is reduced.
3) It saves time since waiting time for inspection is reduced.
4) Line layout of machinery need not be disturbed.
5) Defects may be quickly discovered and corrected and hence working on defective products
could be avoided.
Disadvantages
1) The checking of quality may be hampered by vibration, dust, poor lighting etc. since the
conditions for inspection are not ideal on shop floor.
2) There may be pressure from the workers to accept the work.

25
3) Inspections of high accuracy which require precision instruments cannot be carried out on
the shop floor easily.
4) Because skilled inspectors are required, cost of inspection would be high.
5) There may be accumulation of work near the machines and on the shop floor waiting for
inspection.
Centralised (Crib) inspection: - Under this system, inspection is carried out in a separate
room fully equipped with all measuring instruments and inspection devices. The work to be inspected
is transported to this inspection station.
Advantages
1) A large quantity of work can be economically checked and fewer inspection devices will
only be required.
2) Sub-division of inspection into simple tasks makes it possible to employ less skilled
inspectors.
3) Used on such occasions where accuracy is the priority and precision measuring instruments
are required.
4) The production floor can be maintained orderly by the removal of completed work from
machine area.
5) No pressure from workers to accept work.
6) The conditions are ideal and there is better control of quality due to more accurate inspection.
7) Supervision of inspection work is possible.
8) Used when the required inspection devices cannot be brought to the shop floor.
Disadvantages
1) A large amount of spoiled work may accumulate at the crib before the defect is corrected
at the machine.
2) The handling of material and total processing time are increased.
3) Defects due to machine set up and other machinery errors are not quickly traced out.
4) Production may be delayed due to bottleneck in the inspection room.
5) This method is not suitable for inspecting heavy parts.
Operator inspection: - This means that the operator himself carries out the inspection during
manufacture.
Last piece inspection: - As the name suggests, inspection is carried out on the last item
manufactured in the lot. This helps to rectify the faults in the equipments or set ups beginning from the
next lot.

26
Final inspection: - It is carried out after the final manufacturing stage. The aim is to prevent
defective products being shipped to customers.
Inspection methods
The various inspection methods are:
1) Measurement
2) Go and no-go checking
3) Functional test
4) Visual test
5) 100% inspection
6) Sampling inspection.
DIFFERENCE BETWEEN QUALITY CONTROL AND INSPECTION
As seen earlier, inspection means checking of material, product or components of product
at various stages, with reference to certain pre-determined factors and detecting and sorting out the
faulty or defective items. In inspection emphasis is placed on the quality of the past production.
But quality control is a broad term and involves inspection at a particular stage but mere
inspection does not mean quality control. As opposed to inspection, in quality control activity emphasis
is placed on the quality of the future production.
Consider for example, if the production schedule calls for manufacturing 1000 rods with a
diameter of 25 ± 0.05 mm the inspector will concern himself with whether the rods meet this
specification. Those that do not meet this specification will be rejected and this activity will continue
until 1000 units have been produced.
But the quality control process for the above illustration involves the following activities.
Periodic samples may be taken out of the output and the rods in each sample are inspected. If the
quality of the items in a particular sample is satisfactory, production will be allowed to continue. But
if it is not, corrective action will be immediately taken. This action might involve adjusting the machine,
eliminating defects in the raw material, instructing or replacing the operator etc.
In short, what is learned from inspection of a sample of the product is used as a basis to
ascertain whether the quality of the product produced is according to the set norms.

27
For any manufacturing organization both inspection and quality control are essential. But there
is a marked difference between them which can be briefly represented in a tabular form as below.
Sl. Parameters Inspection Quality Control
No
1 Scope Inspection is a part of Quality control is a broad term.
quality control. It involves inspection at particular
stages, but mere inspection does not
mean quality control.
2 Definition Inspection is an act of Qualitycontrolisaneffective
checkingmaterials,parts, systemforintegratingquality
components or products at development,qualitymaintenance
variousstagesinmanufacturing andqualityimprovementeffortsof
andsortingoutthefaultyor variousgroupsinanorganizationto
defectiveitemsfromgooditems. enable the production to be carried
out at most economical level and to
achievesatisfactionofcustomers.
3 Devicesused Inspectionusesprecision Qualitycontrolusesdevicessuchas
measuringinstrumentssuchas statistics, control charts, acceptance
verniercalipersmicrometersetc. sampling,processcapabilitystudy,
and devices such as tool gauges, V.Q.R(VendorQualityRating).
microscope, profile projector, Qualityaudits,fieldcomplaintsetc.
flaw detector etc.
4 Applicability Inspectionisconcernedwith Qualitycontrolisconcernedwithquality
quality of past production to of future production, For e.g.: - take a
judgeconformancewith sample,inspectit,ifitisdefective find
specificationsandsortingout out the reasons and take corrective
defectiveitemsfromgooditems. action so that such type of defects will
not occur in future. What is learned
from inspection is used as a basis to
ascertainwhetherthequalityofprod
ucts to be produced will meet the
specifications or it is necessary to make
changes in the production process.
5 Concern Inspectionismainlytherespon- Everybodyworkinginanorganization
sibilityoftheinspectors. isresponsibleforqualityofproducts
produced.

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SUMMARY
Total Quality Control is the most necessary inspection control of all in cases where, despite
statisticalqualitycontroltechniquesorqualityimprovementsimplemented,salesdecrease.
The major problem which leads to a decrease in sales was that the specifications did not
includethemostimportantfactor,“Whatthecustomerrequired”.
Themajorcharacteristics,ignoredduringthesearchtoimprovemanufactureandoverallbusi-
ness performance were:-
• Reliability
• Maintainability
• Safety
As the most important factor had been ignored, a few refinements had to be introduced:
1. Marketing had to carry out their work properly and define the customer’s specifications.
2. Specifications had to be defined to conform to these requirements.
3. Conformance to specifications i.e. drawings, standards and other relevant documents, were
introducedduringmanufacturing,planningandcontrol.
4. Managementhadtoconfirmalloperatorsareequaltotheworkimposedonthemandholidays,
celebrationsanddisputesdidnotaffectanyofthequalitylevels.
5. Inspections and tests were carried out, and all components and materials, bought in or other-
wise, conformed to the specifications, and the measuring equipment was accurate, this is the
responsibilityoftheQA/QCdepartment.
6. Anycomplaintsreceivedfromthecustomersweresatisfactorilydealtwithinatimelymanner.
7. Feedback from the user/customer is used to review designs.
Iftheoriginalspecificationdoesnotreflectthecorrectqualityrequirements,qualitycannotbe
inspected or manufactured into the product.
For instance, all parameters for a pressure vessel should include not only the material and
dimensionsbutoperating,environmental,safety,reliabilityandmaintainabilityrequirements.
To conclude, the above forms the basis from which the philosophy of QualityAssurance has
evolved,andtheachievementofqualityorthe“fitness-for-purpose”is“QualityAwareness”throughout
thecompany.

29
An inspection is, most generally, an organized examination or formal evaluation exercise. It
involves the measurements, tests, and gauges applied to certain characteristics in regards to an object
or activity.The results are usually compared to specified requirements and standards for determining
whethertheitemoractivityisinlinewiththesetargets.Inspectionsareusuallynon-destructive.
QUESTIONS
1. What do you understand by Quality Control? What are the steps, aims of quality control?
2. What is inspection? How to go about inspections planning? What are its objectives?
3. Whatarethemostusualconditionssuggestedforinspectionstations?
4. Enumeratethevarioussourcesofinformationforinspection?
5. Describe the various stages and methods of inspection? Discuss its advantages and disad-
vantages?

30
CHAPTER - III
TOTAL QUALITY MANAGEMENT
OBJECTIVE
Total Quality Management (TQM) is a management strategy aimed at embedding awareness
of quality in all organizational processes. TQM has been widely used in manufacturing, education,
government, and service industries, as well as NASA space and science programs.
TotalQualityManagementprovidesanumbrellaunderwhicheveryoneintheorganizationcan
striveandcreatecustomersatisfaction.
TQM is a people focused management system that aims at continual increase in customer
satisfactionatcontinuallylowerrealcosts.TQMiscomposedofthreeparadigms:
• Total:Organizationwide
• Quality:WithitsusualDefinitions,withallitscomplexities(ExternalDefinition)
• Management:ThesystemofmanagingwithstepslikePlan,Organize,Control,Lead,Staff,etc.
AsdefinedbytheInternationalOrganizationforStandardization(ISO):
“TQM is a management approach for an organization, centered on quality, based on the par-
ticipationofallitsmembersandaimingatlong-termsuccessthroughcustomersatisfaction,andbenefits
toallmembersoftheorganizationandtosociety.”TQMrequiresthatthecompanymaintainthisquality
standardinallaspectsofitsbusiness.Thisrequiresensuringthatthingsaredonerightthefirsttimeand
that defects and waste are eliminated from operations.
This chapter gives a quick glimpse of the following themes.
o The concept of TQM – its evolution
o Quality system
o Dimensions of TQM
o TQM operations
TOTALQUALITYMANAGEMENT(TQM)
Introduction
The progress of industrialization and the development of new techniques have led to the
development of large industrial organizations with multiplant and multilevel operations. Thus, today,
the business has to face many challenges due to increase in product complexity, increase in the size
of operations and stiff competition at national and international levels. Strict enforcement of quality
control measures through sound quality management alone can help the company to withstand this
fierce competition. The survival of the fittest is the slogan which the company will have to follow now
to stay in business. To face these challenges, to strive for excellence and grow in business the
responsibility for product quality has gradually shifted from operator (Craftsman) to foreman to
inspector to quality control department and later to quality management.
Over the years focus has been shifted from productivity to productivity linked with quality.

31
Creative and innovative approaches by management have a good potential in quality improvement.
The company can survive the fierce competition if only it pays attention to plan, achieve, maintain
and improve quality constantly to meet the new challenges. The challenges in business are depicted
by the figure 1.
CUSTOMER
SATISFACTION
ENVIRONMENT
CONCERN
BUSINESS
NATIONAL AND
INTERNATIONAL
ECONOMICS
COST OF
MANAGEMENT
TECHNICAL
INNOVATIONS
Fig. (1)
Challenges for business
Understanding of cost of rejection, scrap rework and warranty claims can lead to identification
of problems and quality improvement project and substantial benefits due to improved productivity
and profitability. Managers at highest level should involve themselves to formulate policies and
programmes on quality, allocate needed resources, review progress and recognize efforts of individuals
and teams. They should give due attention to quality, create awareness amongst all employees,
determine training needs on various aspects and establish priorities for quality improvement projects.
Management role and functions have also become more defined. While top management is
concerned with profitability growth, resource generation and management, middle management is in
control of operations, resource utilization, earnings, productivity and cost reduction. Concepts and
techniques of “Total Quality Control” and philosophy of “Quality circles” reflect an integral approach
to Quality Management and envelop all departments at all levels and all categories of staff.
Quality management has moved away from inspection – oriented approach to prevention–
oriented approach. Quality management covers aspects of technology, Statistical Process Control
(SPC), Quality assurance system as well as techniques for identification of problems and problem
solving. Company Wide Quality and Creativity (CWQC) and Total Quality Control (TQC) present
new concepts in quality.

32
HISTORICAL PERSPECTIVE OF QUALITY CONTROL
Quality control passed through many phases, when at last TQM saw its emergence. The
different developments that took place in different periods could be explained as below:
1. Before industrial revolution
During this period craftsmanship was the strategy followed in quality control. i.e., The
craftsman or the master craftsman was responsible for quality control based on his judgment and
experience.
2. During industrial revolution
Supervisory practices prevailed. Quality control was exercised through checks and
supervision of workers by following inspection techniques generally visual in nature.
3. Dawn of the 20th
Century
Inspection techniques grew up. The emergence of mass production led to the development
and sophistication in inspection techniques. Emphasis was still on the finished products.
4. After the world war
Statistical Quality Control emerged. Basic statistical principles were employed to develop
sophisticated techniques of quality control. It led to the introduction of the sampling tables and control
charts. It was used to control the quality of the products during the manufacturing stages. Statistical
analysis was used as a feed back to bring appropriate changes in process and also for controlling the
process.
5. Modern era
The concepts like Total Quality Control (TQC), Quality Assurance, Company Wide Quality
& Creativity (CWQC) and Zero Defect quality control are developed. i.e., TQM had its emergence.
Inspection oriented approach gave way to prevention oriented approach by identifying problems before
they occur and solving them.
TQM – DEFINITION
Total Quality Management (TQM) refers to the total involvement of people in an organization
together. This includes suppliers, distributors and even customers in bringing about quality satisfaction
by promoting quality cultures through quality circles, job enrichment and effective purchasing. Workers
and supervisors have to be trained to solve the problems in product/process variations.
Another definition is that “TQM is the control of all transformation processes of an organization
best to satisfy customers’ needs in the most economical manner.”

33
The management can ensure this through:
a) Team effort
b) Satisfying workers’ emotional and intellectual needs and a need for better working conditions.
The workers’ attitude towards the products of the company and their quality is also dependent
on the industrial relations climate in the organization. If the climate reflects a feelings of fairness
in personal decisions, prompt redressal of grievances and open communications, the
probability will be high that workers will be responsible and responsive to management’s
advice. They may develop pride in their organization and its products. Such a pride and
sense of belonging will have a great impact on product quality and productivity.
c) Installing motivation system, to include collective achievement and quality excellence.
d) Integration and co-ordination of activities of various departments such as product design,
R&D, production planning, manufacturing/processing, technical services, sales etc., to attain
the desired goals economically.
e) Maintaining a sound quality system, to ensure that each task is performed correctly.
f) Parameters responsible for product quality and quality concepts need to be clearly understood
by management if the marketed products are to satisfy the users and a good image of quality
is to be developed to strive for excellence.
Quality System
To assure quality one has to ensure the quality. To ensure quality it is necessary to adopt a
standard procedure and to make systematic control at every stage and to take critical review of efforts
and achievements of the company with respect to quality of the product.
Quality system includes all aspects from the preparation of tenders to the eventual delivery,
installation and commissioning of products and also its after sales service.
According to Dr. Feiginbarum “A total quality system is the agreed companywide and
plantwide operating work structure, documented in an effective and integral technical and managerial
procedures for guiding the co-ordinated efforts of work force, the machines and the infrastructure of
the company and plant in the best and most practical ways to ensure customer quality satisfaction
and economical costs of quality.”
Through these documented procedures, the system imposes discipline in all the company’s
operations. This will reduce rework, waste by reducing rejections etc. Prompt delivery is also ensured.
Operating efficiency will improve.
Some of the quality documents and systems that are needed for the TQM are
1. Quality assurance manual
This document outlines the total quality system of the plant. It defines the role and
responsibilities of the various disciplines of the organization relating to quality.

34
2. Quality assurance plan
This document is prepared for every product manufactured and gives the total plan for quality
control at every stage of manufacture of a product.
3. Quality Check lists/log sheets
These documents are prepared for specific items/operations/processes to record the achieved
values vis-a-vis the designed/required values.
4. Internal plant standards
These documents deal with raw materials, various manufacturing processes and standards.
5. Site action reports
This is an important feed back system for corrective action.
6. Use of statistical techniques for solving quality problems and for improvement in quality.
7. Quality audits
Audits are carried out to evaluate the effectiveness of quality systems.
Quality Management system has to be supported by:
1. Management participation and attitude
2. A professional quality management training programme
3. Innovation, i.e., introduction of new ideas, methods, techniques.
4. Adequate recognition to persons contributing to the same.
DIMENSIONS OF TQM
TQM has three important dimensions. These are:
1. Excellence: - The objective should be nearer to perfection.
2. Universality: - In TQM entire factors such as products, processes,
customers and employees play very important role to achieve, maintain and improve
quality.
3. Perpetuality:- TQM has aspects of steadiness of progressive steps which is directed to
attain perfect quality through continuous and innovative approach for improvement of process
using structural, systematic and analytical approach to problem solving.
TQM OPERATION
Operation and implementation of TQM encompass four P’s namely:
1. People involvement

35
2. Process/Product innovation
3. Problem investigation
4. Perpetual improvement
The TQM operations could be depicted as below: -
-Leadership -Consciousness
-Teamwork -Recognition
Fig (2) TQM Operations
TQM operations are carried out by means of the PDCA principle. PDCA means,
— Plan (Design, Innovate)
— Do (manufacture)
— Checks (Inspection and test)
— Act (Countermeasure, modification)
Just In Time (JIT Manufacturing)
KANBAN is the Japanese name to JIT, actually it means in Japanese language “A marker
used to control the sequence of Jobs through a sequential process”. JIT is a new concept in
manufacturing where material is pulled through the process by the next operation, when the problem
occurs the process is shut down. The system removes the buffer to inventory that actually accompanies
large Economic Order Quantity (EOQ). This can be accomplished if the various parts which go into
the final manufacturing conform to PPM (Part Per Million) level towards zero.
Zero Defect Concept (ZD Concept)
The zero defect concept seeks the voluntary participation of workers in understanding personal
responsibility for the quality of the task they perform. The concept was originated in 1961 by Philip
People involvement
Process /product
innovation
Perpetual
improvement
TQM
Problem
investigation
- Do JIT
- No inventory
- Innovation
- Eliminate waste
- Eliminate waste
- Control Process
- Constant Problem
Solving (analytically)
- Reduce Variability
(ZD approach)

36
Crossby, and later developed by Jim Halpin. The technique was to establish a running production
line inspection by operatives who were individually pledged to achieve the necessary quality standard
as the first manufacturing or assembly operation.
Quality education and training programme
The quality management training programmes may be of several forms such as
1. Formal courses at educational institutes on quality management, generally under continuing
education.
2. Courses and seminars arranged by professional bodies and industry associations. These may
include short term courses, seminars and correspondence courses.
3. Meetings and conferences by associations which help to create awareness, share experiences
and update knowledge.
4. Self instructions and study, using books, journals to develop requisite knowledge.
5. In house training programmes which are aimed at
a. Improving morals and human relations climate in the organization
b. Imparting knowledge and training in quality disciplines
c. Increasing individual’s awareness to quality
d. Quality system and allied training.
e. Introductory training with the objectives to develop requisite, right attitudes to quality.
In-house training should be tailored to the needs of different categories of personnel.
Training should serve as a communication mechanism for educating workmen, updating their
knowledge. In-house training may be provided in the following subjects: - Quality concepts,
Quality control, metrology, reliability, material testing, vendor development, costs of quality,
quality circles, problem solving techniques, quality system and documentation, SQC
techniques and recent development.
6. On-the-job-training provided by senior experienced staff along with professional experts.
SUMMARY
Qualityassurancethroughstatisticalmethodsisakeycomponentinamanufacturingorganiza-
tion,whereTQMgenerallystartsbysamplingarandomselectionoftheproduct.Thesamplecanthen
betestedforthingsthatmattermosttotheendusers.Thecausesofanyfailuresareisolated,secondary
measures of the production process are designed, and then the causes of the failure are corrected. The

37
statistical distributions of important measurements are tracked. When parts’ measures drift into a de-
fined“errorband”,theprocessisfixed.Theerrorbandisusuallyatighterdistributionthanthe“failure
band”, so that the production process is fixed before failing parts can be produced.
It is important to record not just the measurement ranges, but what failures caused them to be
chosen.Inthatway,cheaperfixescanbesubstitutedlater(say,whentheproductisredesigned)withno
loss of quality.AfterTQM has been in use, it’s very common for parts to be redesigned so that critical
measurements either cease to exist, or become much wider. Quality management is a method for
ensuring that all the activities necessary to design, develop and implement a product or service are
effective and efficient with respect to the system and its performance. The philosophy is to keep im-
provingthequalityofanorganization.Itisdefinedbyfourkeys:
• Plan:Designorrevisebusinessprocesscomponentstoimproveresults
• Do:Implementtheplanandmeasureitsperformance
• Check:Assess the measurements and report the results to decision makers
• Act: Decide on changes needed to improve the process
QualityAssurancecoversallactivitiesfromdesign,development,production,installation,ser-
vicinganddocumentation,thisintroducedtherules:“fitforpurpose”and“doitrightthefirsttime”.It
includestheregulationofthequalityofrawmaterials,assemblies,productsandcomponents;services
related to production; and management, production, and inspection processes.
QUESTIONS:
1. Whatarethechallengesinbusiness?Explainbyillustrations?
2. Describethedifferentdevelopmentsthattookplaceindifferenthistoricalperiodsofthe
processofqualitycontrol?
3. DefineTQM?(TotalQualityManagement).HowcanmanagementensureTQMtosatisfy
customerneeds?
4. Explain the quality documents and systems that are needed for TQM?
5. ExplaintheimportantdimensionsofTQM?

38
CHAPTER – IV
BENCHMARKING
OBJECTIVE
Benchmarking (also “best practice benchmarking” or “process benchmarking”) is a process
used in management and particularly strategic management, in which organizations evaluate various
aspects of their processes in relation to best practice, usually within their own sector.This then allows
organizations to develop plans on how to adopt such best practice, usually with the aim of increasing
some aspect of performance. Benchmarking may be a one-off event, but is often treated as a continu-
ousprocessinwhichorganizationscontinuallyseektochallengetheirpractices.
Aprocesssimilartobenchmarkingisalsousedintechnicalproducttestingandinlandsurvey-
ing.
Benchmarking is a powerful management tool because it overcomes “paradigm blindness.”
ParadigmBlindnesscanbesummedupasthemodeofthinking,“Thewaywedoitisthebestbecause
this is the way we’ve always done it.” Benchmarking opens organizations to new methods, ideas and
toolstoimprovetheireffectiveness.Ithelpscrackthroughresistancetochangebydemonstratingother
methods of solving problems than the one currently employed, and demonstrating that they work,
because they are being used by others.
This chapter deals with the following themes.
— Concept of Benchmarking - Its various types
— Steps involved in Benchmarking.
Introduction
Benchmarking is a powerful tool for improvement. It is one of the fastest growing techniques
for quality and performance improvement and attracts massive attention. Rober .C. Camp is the
founding father and leading guru of benchmarking techniques. Today benchmarking means comparing
practices and procedures to those of the best for the purpose of learning to become better.
Benchmarking is thus a recognized tool in the development of a continuous improvement process.
Definition
The essence of benchmarking is “moving from where you are to where you want to be.”
The dictionary meaning of the word ‘benchmark’ is: A standard or point of reference in
measuring or judging quality, value etc.
Philosophically benchmarking can be defined as: “Benchmarking is the process of being
humble enough to admit that someone else is better at something and being wise enough to learn how
to match and even surpass them at it.”

39
We can also define benchmarking as “It is the process of identifying, understanding and
adapting outstanding practices from within the same organization or from other business to help improve
performance.”
Thus benchmarking involves a process of comparing practices and procedures to those of
the best to identify ways in which an organization can make improvements. Thus new standards and
goals can be set which, in turn, will help satisfy the customer’s requirements for quality, cost, product
and service in a better manner. In this way organizations can add value to their customers and distinguish
themselves from their competitors.
Reasons for Benchmarking
The reasons for adopting benchmarking programme by organisations as a catalyst for change
are, to:
— Increase efficiency
— Create customer awareness
— Enhance customer satisfaction
— Improve profitability
— Promote understanding
— Make continuous improvement
— Gain commitment to corporate goals.
Types of Benchmarking
Benchmarking can be classified in two ways:
1. According to what is compared
2. According to whom it is compared.
i) Benchmarking of ‘What’
Three types of benchmarking can be defined depending on what is being measured.
i) Performance benchmarking
It is comparison of performance measures (often financial, but also operational) for the
purpose of determining how good one’s own company is compared to others. Some of the
performance measures that can be benchmarked are – sales cost/revenue, service cost/revenue,
distribution cost/revenue, materials overheads, man power performance ratio, cost per unit, cost per
order, return on assets, percentage of rejected products, percentage of rejected parts, customer
satisfaction, billing error rate, service response time, rate of on – time delivery etc.
(ii) Process benchmarking
This is the comparison of methods and practices for performing business processes for the
purpose of learning from the best to improve one’s own processes.

40
A business process is defined as a chain of logically connected repetitive activities, that make
use of the organization resources to refine an object (physical or mental) with the objective of producing
specified and measurable results/products for internal or external customers.
Some of the process that can be bench marked are – Accounting, HR planning, ISO –
9000, Materials management, Maintenance management, Communications, R&D, Leadership,
Reliability, etc.
(iii) Strategic benchmarking
This is the comparison of the strategic choices and dispositions made by other companies,
for the purpose of collecting information to improve one’s own strategic planning and position. Strategic
bench marking is usually done against direct competitors.
Benchmarking against ‘Whom’
There are mainly four types of bench marking which can be undertaken by an organization.
1. Internal
2. Competitive
3. Non- Competitive
4. Best practice/world class
i. Internal benchmarking: - This is the easiest type of benchmarking to conduct since it involves
measuring and comparing data on similar practices from other parts of an organization, for
e.g.: - one branch office with one another. Internal benchmarking creates an environment of
two – way communication and sharing within an organization. It also overcomes any problems
of confidentiality and trust.
ii. Competitive benchmarking: - This type of benchmarking is against direct competitors. This
is often easier for larger industries than smaller ones. It is also sometimes difficult to collect
competitive information, although independent industry surveys and reports, if available, do
offer useful information.
iii. Non-Competitive benchmarking:- It is possible to benchmark a process by measuring and
comparing.
— A related process in a non-competitive organisation.
— A related process in a different industry.
— An unrelated process in a different industry.
In this way, improvements can be identified which can be adapted to the organization.
iv. Best practice/world class benchmarking:- This approach to benchmarking involves learning
from best – practice or world class organization, the leaders of the process being
benchmarked. Collection of data will be sometimes difficult in this case.

41
Code of conduct
There are certain ground rules for the exchange of information between the benchmarking
partners. The rules are as follows: -
1) Principles of legality
Avoid discussions or actions that might lead to or imply an interest in restraint of trade, market
or customer allocation of schemes, price fixing dealing arrangements, bribery or misappropriation.
Do not discuss costs with competitors if costs are an element of pricing.
2) Principle of exchange
Be willing to provide the same level of information that you request in any benchmarking
exchange.
3) Principles of confidentiality
Treat benchmarking interchange as something confidential to the individuals and organizations
involved. Information must not be communicated outside the partnering organizations without prior
consent of participating benchmarking partners. An organization’s participation in a study should
not be communicated externally without permission.
4) Principle of use
Use of information obtained through benchmarking partnering is only for the purpose of
improvement of operations with the partnering companies themselves. External use or communication
of benchmarking partner’s name with their data or observed practices requires permission of that
partner. Do not extend one company’s permission as a consultant or client to another company.
5) Principle of first party contact
Initiate contacts wherever possible, through benchmarking contact designated by the partner
company. Obtain mutual agreement with the contact in case of any handling over of communication
or responsibility to other parties.
6) Principle of third party contact
Obtain an individual’s permission before providing their name in response to a request for a
contact.
7) Principle of preparation
Demonstrate commitment to the efficiency and effectiveness of the benchmarking process
with adequate preparation at each process step, particularly at initial partnering contact.
To contribute efficient, effective, ethical benchmarking, individuals enter into an agreement
on behalf of themselves and their organization to abide by the above principles for benchmarking
with other organizations.

42
1. Identify what to
benchmark
2. Determine what
to measure
3. Identify who to
benchmark
4. Collect the
data
5. Analyze data and
determine the gap
6. Set goals and
develop an action
plan
7. Monitor the
process
Fig. (3) Steps involved in benchmarking
1. Identify what to Benchmark
The first step of seven-step benchmarking model keeps the efforts focused and involves the
following sub-steps:
i. Clarify the benchmarking objectives
Benchmarking decision may be driven by any one of the following factors:-
— An organization-wide strategy, setting priorities for improvement - Benchmarking is an
ideal tool to improve a process that has already been targeted.
— The need to address a specific problem that requires immediate attention.
— A new business environment
— Not meeting goals in previous attempts to improve a process.
ii. Decide whom to improve
After deciding the process, decide the members of the benchmarking team. The team must
fulfill the following roles – team leader, link to management or benchmarking sponsor, process owners,
Steps involved in benchmarking
Benchmarking is an ongoing process that requires data gathering, goals setting and analysis.
When benchmarking is used it is necessary to go through same steps twice and spend more time on
the same depending on what is to be benchmarked. The seven steps involved in benchmarking are
as below: -

43
process involves suppliers to the process – internal or external, customer to the process – internal or
external, facilitator.
iii. Define the process
An organization should understand its business process first which helps to compare them
with other parts of the organization or with external sources. A process is a series of inter – related
tasks that are organized to produce an output which may include creating product, providing customer
needs when they need and expect it. The process should be customer driven. Process can be identified
by considering certain Critical Success Factors (CSF). CSF is a limited number of factors that have
an impact on the competitiveness. e.g.: - Price, Quality, Service etc.
iv. Consider the scope
If the scope is too large, it is difficult to tackle it effectively. For e.g.: - Bench marking the
human resources function. If the scope is too narrow, benchmarking efforts might miss improvement
opportunities. For e.g.:- the prospective employee interview scheduling process.
v. Set the boundaries
Boundaries of each process can be defined by identifying the input received from internal
suppliers and output that goes to internal customers. Well defined boundaries would help in successful
improvement of the process. Input for a process will be materials, information and data. Outputs will
be services and products.
vi. Agree on the process
To agree on the process by the team, first a brainstorming is conducted. All the major tasks
in the process are included for discussion so that the team members must come to an agreement on
the nature and order of the tasks. Everyone might not be familiar with all the tasks and all the team
members must agree on the starting and finishing points of each task.
vii. Chart the process
Different types of charts can be used – like flow diagram, flow charts, supply chain charts
etc. This can be used on a ‘working document’ to help and define the process.
2. Determine what to measure
The key to make meaningful comparisons in benchmarking is to select clear and accurate
measures before looking at processes in other organizations. Factors to be noted are
— It is better to have a few meaningful measures than many ineffective measures.
— The time invested in selecting and gathering should be the time that cannot be spent any
where in benchmarking efforts.
— Right things should be measured. The measures that are critical to the improvement objectives
should be focused.

44
Three steps are involved in determining process measures:
i. Examine the chart: - The team should first verify that all the tasks and decision points are
clearly charted, and every one agrees on each task and its order in the process. Next, make
sure that the time to complete each task is also marked on the chart and that all the inputs
and outputs are listed. Then review the chart to get measurable items.
ii. Establish process measures: - In benchmarking process measures outside the process
also should be considered. That is, the measures of the organizations external customers’
requirements and the measures of internal suppliers’ and customer’s requirements are to be
considered. So the internal suppliers and customers are to be interviewed to know their
respective perspectives. Then the process measures are to be brainstormed. The supplier
and the customer measures should be linked with in- process measures and select the
measures to be benchmarked.
iii. Verify if measures match objectives: - After all these, it should be verified if measures
match with the objectives of the benchmarking team.
3. Identify who to benchmark
Benchmarking information can be obtained from certain trade magazines, market research
etc. There are four rules, which are generally used to establish benchmarking partners: -
1. To look inside the organization.
2. To gather external data in the other competitive business.
3. To gather external data in the same industry or similar areas.
4. To establish partnerships with organizations who are considered ‘World best’ or ‘Best in
class’ irrespective of their industry location or sector.
Partner here refers to an organization which will co-operate fully with sponsor organization
for exchange of information. For selecting the best partner team members should brainstorm a list of
potential partners. Then the customers and suppliers also should make such a list.
The types of benchmarking partners are as below: -
Fig. (4)
Internal External
Your business Your
competitors
Similar
industries
Best practice
Same Location Same Location Different Companies Any Company
Other Location Any Location Any Location Any Industry
Different Business Any Location
Same company

45
4. Collect the data
The key to success in benchmarking is to collect the right information. This should be collected
both quantitatively and qualitatively. First the teams identify what exact information is required and
what are its constraints. There are three main sources of information such as:
(i) Internal:- The past research available within the organization such as product studies, R&D,
market surveys, customer or house surveys or even management and operational expertise.
(ii) Public information:- Useful information can be found in public – access resources such
as trade magazines, industry publications, professional journals, market research, Government
studies, computer databases, telephone or mail surveys, benchmarking experts and consultants,
organizations specializing in benchmarking etc.
(iii) Other companies:- Most exciting part of bench marking process. This requires confidentiality
and time constraints need to be carefully considered.
Certain other techniques to gather information are by using questionnaires and conducting a
bench marking site visit.
5. Analyze data and determine gap
Once data has been collected the task of the project team is to interpret the information
they have acquired and identify the areas of improvement. The analysis takes two forms – review of
data and preparation of gap analysis.
The first step is to quantify the differences in information gained from benchmarking partners.
One method to evaluate information is to graph it. When the data becomes a picture, the performance
gap will be obvious to the whole team. Quantitative differences should be relatively straight forward
to calculate. It is possible to identify performance means as well as calculating differences between
one benchmarking partner and another. After the analysis is complete, the next step is to identify our
own company’s performance measures and to make comparison with other benchmarking partners.
Thus a comparison is made between target performance and actual performance. When internal
standard is higher than the target performance it is termed as positive gap. When the performance
level – internal is lower than the target performance or best practice it is called negative gap. The
cause for the change is analysed.
6. Set goals and develop an action plan
Having identified both the size of gap in performance and potential causes, the next step is
to identify and prioritise areas of change and to draw up a plan for improvements.
The team members set goals for the process. A goal is a ‘desired state’. Each of the measures
used to benchmark against should have at least one goal. Some may have several sub-goals. To set
goals the following should be noted: -
— Goals should be achievable in increments

46
— Goals should be realistic
— Goals must be measurable
— Goals should be finite
— Goals should be supportive.
Developing an action plan, after the goals are set, involves two steps.
i. Determine tasks, timeliness and responsibilities
Divide the goals into separate and manageable tasks, put them in order and determine who
is responsible for each tasks. Set target for start and finish.
ii. Develop a contingency plan
It is important to create a ‘plan B’ in case things get side – tracked with plan A or need to
be changed in midstream. By developing a contingency plan any unexpected problems or occurrences
can be handled.
7. Monitoring the process
The action plan is in place and every one is adjusting to all the new changes. To ensure that
the bench marking efforts live on, it is important to track the changes and make bench marking a
habit.
There may be several reasons for the people to resist changes. These can be changed by
training. It is essential to track all of these activities to ensure that the changes are implemented and
steps on action plan do occur, as planned. It is important that the action plan is carefully monitored.
For this, evaluate the measures, conduct regular meetings, keep an open channel with the organization
(benchmarking partner), keep up with the new technology, re-evaluate and re-adjust the goals
periodically.
To fully reap the benefit from benchmarking it has to be a periodic and regular course of
action. It should eventually become a part of TQM system of an organization.
BENEFITS AND PITFALLS
Benefits
— It sets performance goals
— It helps accelerate and manage change
— It improve processes
— It allows individuals to see outside the box
— It generates an understanding of world class performance.
Pitfalls
— Certain factors cause its failure
— Lack of focus and priority

47
— Lack of strategic relevance
— Lack of leadership
— Lack of perseverance and
— Lack of planning.
SUMMARY
Benchmarkingisaprocessofcomparinganorganization’sorcompany’s performance to that
of other organizations or companies using objective and subjective criteria. The process compares
programs and strategic positions of competitors or exemplary organizations to those in the company
reviewingitsstatusforuseasreferencepointsintheformationoforganizationdecisionsandobjectives.
Comparing how an organization or company performs a specific activity with the methods of a com-
petitororsomeotherorganizationdoingthesamethingisawaytoidentifythebestpracticeandtolearn
how to lower costs, reduce defects, increase quality, or improve outcomes linked to organization or
companyexcellence.
Organizations and companies use benchmarking to determine where inputs, processes, out-
puts, systems, and functions are significantly different from those of competitors or others. The com-
mon question is what is the best practice for a particular activity or process? Data obtained are then
usedbytheorganizationorcompanytointroducechangeintoitsactivitiesinanattempttoachievethe
bestpracticestandardiftheirsisnotbest.Comparisonwithcompetitorsandexemplaryorganizations
ishelpfulindeterminingwhethertheorganization’sorcompany’scapabilitiesorprocessesarestrengths
or weaknesses. Significant favorable input, process, and output benchmark variances become the
basis for strategies, objectives, and goals. Often, a general idea that improvement is possible is the
reasonforundertakingbenchmarking.Benchmarking,then,meanslookingforandfindingorganiza-
tions or companies that are doing something in the best possible way and learning how they do it in
ordertoemulatethem.Organizationsorcompaniesoftenattempttobenchmarkagainstthebestinthe
worldratherthanthebestintheirparticularindustry.
ADVANTAGE OF THE BENCHMARKING FOR A COMPANY:
1.Abetter understanding of the waits (expectations) of the customer because it is: based on the
realityofthemarketestimatedinanobjectivistway.
2.Abettereconomicplanningofthepurposesandtheobjectivestoachieveinthecompanybecause
they are: centered on what takes place outside controlled and mastered.
3.Abetter increase of the productivity: resolution of the real problems Understanding of the pro-
cesses and what they produce”
4. Better current practices Search for the change many decisions practices of break.

48
5.Abetter competitiveness thanks to: a solid knowledge of the competition a strong implication of
the staff new ideas on practices and tried techniques.
Benchmarkinghasconsequenceswhicharebeyondtheprocessitself:itreformsallthelevelsof
the company.; modifies the process of manufacture of the product leads(drives) ; also reforms the
hierarchicalorganizationofthecompany,theproductitself,andthestateofmindoftheemployees.
Procedure
1. Identify your problem areas - Because benchmarking can be applied to any business process
orfunction,arangeofresearchtechniquesmayberequired.Theyinclude:informalconversa-
tions with customers, employees, or suppliers; exploratory research techniques such as focus
groups; or in-depth marketing research, quantitative research, surveys, questionnaires,
reengineering analysis, process mapping, quality control variance reports, or financial ratio
analysis.
2. Identifyorganizationsthatareleadersintheseareas-Lookfortheverybestinanyindustryand
inanycountry.Consultcustomers,suppliers,financialanalysts,tradeassociations,andmaga-
zinestodeterminewhichcompaniesareworthyofstudy.
3. Surveycompaniesformeasuresandpractices-Companiestargetspecificbusinessprocesses
usingdetailedsurveysofmeasuresandpracticesusedtoidentifybusinessprocessalternatives
and leading companies. Surveys are typically masked to protect confidential data by neutral
associationsandconsultants.
4. Visit the “best practice” companies to identify leading edge practices - Companies typically
agreetomutuallyexchangeinformationbeneficialtoallpartiesinabenchmarkinggroupand
sharetheresultswithinthegroup.
5. Implement new and improved business practices - Take the leading edge practices and de-
velopimplementationplanswhichincludeidentificationofspecificopportunities,fundingthe
projectandsellingtheideastotheorganizationforthepurposeofgainingdemonstratedvalue
from the process.
Benchmarkingisamoderatelyexpensiveprocess,butmostorganizationsfindthatitmorethan
pays for itself. The three main types of costs are:
• Visit costs -This includes hotel rooms, travel costs, meals, a token gift, and lost labour time.
• Time costs - Members of the benchmarking team will be investing time in researching prob-
lems,findingexceptionalcompaniestostudy,visits,andimplementation.Thiswilltakethem
away from their regular tasks for part of each day so additional staff might be required.
• Benchmarkingdatabasecosts-Organizationsthatinstitutionalizebenchmarkingintotheirdaily
procedures find it is useful to create and maintain a database of best practices and the compa-
nies associated with each best practice now.
A problem with benchmarking is it may restrict the focus to what is already being done. By
emulatingcurrentexemplaryprocesses,benchmarkingisacatch-upmanagerialtoolortechniquerather

49
than a way for the organization or company to gain managerial dominance or marketing share.
Benchmarking can foster new ideas or processes when management uses noncompetitive organiza-
tions or companies outside its own industry as the basis of benchmarking. What if new ideas are not
generated?Itispossiblethatnooneinsomeotherorganizationorcompanyhashadagreatideathatis
applicabletotheinput,process,oroutcomethattheorganizationisattemptingtoimproveorchangeby
benchmarking.
Benchmarkingisnotacompetitiveanalysis.Benchmarkingisthebasisforchange.Itisabout
learning.Theorganizationperformingthebenchmarkanalysisusestheinformationfoundintheprocess
to establish priorities and target process improvements that can change business or manufacturing
practices.Benchmarkingcommonlytakesoneoffourforms.
QUESTIONS:
1. DefineBenchmarking?Whatareitsreasons?
2. ExplainthetypesofBenchmarking?Whatarethegroundrulesforexchanginginformation
betweenbenchmarkingpartners?
3. DescribethestepsofBenchmarking?Drawasuitableillustration?
4. Whatarethebenefitsandpitfallsinbenchmarking?

50
CHAPTER - V
QUALITY CIRCLES
OBJECTIVE
Quality is conformance to the claims made.Aquality circle is a volunteer group composed of
workers who meet together to discuss workplace improvement, and make presentations to manage-
mentwiththeirideas.Typicaltopicsareimprovingsafety,improvingproductdesign,andimprovement
inmanufacturingprocess.Qualitycircleshavetheadvantageofcontinuity;thecircleremainsintactfrom
project to project. A Quality Circle is a small group of employees from the same work area who
voluntarily meet at regular intervals to identify, analyze, and resolve work related problems.This can
not only improve the performance of any organization, but also motivate and enrich the work life of
employees.
Learning Objectives
This chapter mainly deals with
— Meaning of Quality Circle and its various objectives
— Structure of Quality Circles
— Training Techniques etc.
Introduction
Quality Circle (QC) consists of a group of people, who are doing the same or similar work,
who meet voluntarily and regularly to identify, analyse, discuss and solve work related problems.
Members of QC must be from the same work area who do the same or similar work so that the
problems they identify will be familiar to all the members for effective participation. The optimum size
of a circle is seven or eight members. The number of members should be such that the circle is effective.
If the size is high every member cannot get sufficient time and opportunity to participate and contribute.
As the main objective is to involve people, the concept can be practiced in such diverse
areas as manufacturing, merchandising, hospitals, nursing homes, financial institutions, educational
institutions, insurance corporations, travel agencies, hotels etc. The outstanding features of the quality
circles are: -
a) The organization gets the total man.
b) Humanises the work i.e., quality of work life is stressed and improved.
c) Brings out extra-ordinary qualities from ordinary people.

51
d) To display the human capabilities fully and eventually draw out infinite possibilities.
e) Prepares the employer and employees to meet the challenges of the changing time and
conditions.
Why Quality Circles
The human mind is a fundamental resource. The priceless faculty of thinking and discriminating
has to be harnessed for the advantage of the organization. Money, machine, materials and methods
are to be handled by men. The organization may have people; some willing to work and rest willing
to let them work. Some of these people may have something to say and they can’t and certain others
may have nothing to say and they keep saying. The QC concept makes every one to participate and
contribute, thereby maximizing the human resources for the overall benefit of the organization.
History of QC
The basic idea of worker participation was effectively used in United States in the 1940s.
One of the famous users is Walt Disney. IBM also used group solving techniques in the late 40s.
After the World War II companies grew at a much faster rate and mass production caused too many
problems. Communication and closeness of management and workers were lost.
In the late 50s Sidney Rubenstine started a programme called Participative Management
System and the basic philosophy was the same as that of Quality Circles. The philosophy that workers
know their job best and have the knowledge required to improve the quality is employed effectively
in this programme.
After the World War II, when many industries in Japan had been destroyed, Japanese felt
that something should be done to improve the nation’s image and requested the United States
Government to send some experts to teach quality control methods. Dr. Edward Deming, Statistician
for the Government was sent in 1948 followed by Dr. Juran, a famous consultant in 1954 to lecture
what is known as ‘Total Quality Control’.
Quality Circles were conceived in Japan in 1961, under the leadership of Dr. Kaori Ishikawa,
then an Engineering Professor in Japanese prestigious Tokyo University. Dr. Ishikawa, under the
sponsorship of the Japan’s Union of Scientists and Engineers (JUSE) structured the theories of the
behavioral scientists such as Maslo, Herzberg, Mc Gregor to the Quality Science introduced to Japan
by Dr. Deming & Dr. Juran. The result was a system that was called Quality Control Circles. The
first circle was registered with JUSE during May, 1962.
In the case of India, it is reported that BHEL initiated the first circle in January, 1981.

52
Objectives of Quality Circles
In order to ensure success in the QC programme it is imperative to lay down objectives.
Well-defined objectives help to direct various activities and efforts, and to plan personnel and funding
for future growth. It is essential to set and define objectives and communicate them throughout the
organization.
The objectives can consist of many goals, major and minor, short-range and long-range.
The goals should be constantly reviewed and updated so that everyone in the organization is fully
aware of the current status of the progress. The goals are kept compatible in tune with the conditions
that exist in the organization.
The various objectives of Quality Circles are: -
— Ensure harmony
— Better inter-relation
— Effective team work
— Job satisfaction
— Improve quality
— Problem – prevention ability
— Communication
— Self-development
— Leadership development
— Safety awareness
— Productivity
— Teambuilding
— Participation
— Self – discipline.
Quality Circle Operation
The QC operation cycle is shown below:-

53
Review of
recommend
ation,
approval by
management
Implem-
entation
Problem
identification
Problem
selection
by
member
s
Problem
analysis and
discuss on
alternatives
Arrive at
best
solutions
Management
presentation
Data from
specialists
if
necessary
Fig. (1)

54
The operation cycle is as follows
a) Problem identification by any member.
b) Problem selection by members.
c) Problem analysis and discuss on alternatives (Data from specialist, if necessary).
d) Arrive at best solutions.
e) Management presentation.
f) Review of recommendations and approval by management
g) Implementation.
a. Problem identification emanates from
- the members of the circle
- management
- staff or technical experts.
b. Several problems are identified and the selection of the problem is the prerogative of the
circle.
c. Problem analysis is carried out by the circle, with the assistance, if necessary, with the
competent technical experts and other functional agencies.
d. Circle members discuss various alternatives and arrive at the best possible solution by
consensus.
e. The circle makes its recommendations directly to its Manager or Department Heads using a
powerful communication technique known as ‘The management presentation’.
f. After the management presentation, the management reviews the suggestions and solutions
thoroughly in consultation and co-ordination with peripheral departments such as Industrial
Engineering, Quality Control etc., and approves or disapproves them.
g. Approved recommendations are implemented. Recommendations that are not approved are
communicated to the circle members. It is imperative to explain the reasons to the members
of the circle for not approving their recommendations. Communications should be effective
in either case.
Identification of possible projects or problems
QC can identify the problems in several ways: -
a) From the familiarity of the members as well as leaders with the operation in which they are
involved in day-to-day work.
b) From the proposals or suggestions by Quality Control Staff.

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